When They Say “BARRED,” They Mean It

by Christopher J. Gray on September 16, 2011

in FINRA,SEC,Securities Fraud

John A. “Jack” Grant, a former stockbroker, was barred from associating with investment advisers, brokers and dealers in 1988, following an action that accused him of selling unregistered securities and misappropriated funds totaling $5,500,000. Grant, however, did not withdrawal from the securities business and continued advising small business and individuals on their investments and management of their assets. Some of the individuals he advised were brokerage customers from before the SEC bar.

When they say barred they mean it

As a result of Grant’s violation of the bar, the Securities and Exchange Commission filed a civil injunctive action against him, along with Sage Advisory Group LLC and Benjamin Lee Grant. Lee Grant is Sage Advisory Group’s owner, as well as Jack Grant’s son. Grant allegedly has been using his son to implement his advice to investors.

According to the complaint filed by the SEC, Grant has advised clients, through his son, from at least 1998. Furthermore, Grant’s son, who is fully aware of the bar against him, allowed him to be associated with Sage Advisory Group and neither they, nor the firm, informed their clients that Grant had been, and remains, barred from association with investment advisors. This, according to the complaint, is in violation of Section 206 and 207 of the Investment Advisers Act of 1940.

And Grant should know better — he’s a lawyer. In fact, in addition to the bar from association with investment advisers, he was suspended from practicing law for one year in 1994 after a conviction for bankruptcy fraud.

Any investor considering hiring an investment adviser or stockbroker should check SEC’s website by using their “Investment Adviser Public Disclosure” page or FINRA’s BrokerCheck for information on that adviser or broker. If, after checking out your adviser or broker, you discover that they have been barred from associating with brokers, dealers, or investment advisers, contact an investment attorney for help. The Law Office of Christopher J. Gray can be reached at (866) 966-9598 for a no-cost, confidential consultation.

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